What I really like about healthcare value analysis is its versatility in use in so many different aspects of products, services, technologies, and yes, even processes. Value analysis is all about the functional approach. When you focus on function first, all other attributes will fall into place, like price and quality as well as one of the most important aspects which is reliability. These are the anchors of healthcare value analysis that when used in concert with a solid methodology and process will smooth the path to cost, quality, and process improvement.
But This Article is About Forgotten Aspects!
There are, however, some often forgotten aspects of healthcare value analysis that we must always remember as we travel 100 miles an hour through our days, weeks, months, and years. The intention of this article is to bring these back to your core value analysis lexicon as you work towards you and your organization’s success!
New Product Requests Are More Revenue Enhancement than Cost Management – When you look at the spend and cost aspect of a new product request, you clearly see that in many cases it will increase costs to your supply budget. Part of the increases are new devices and systems that will open the door to new revenues for your healthcare organization. These are in a hidden pipeline of new sales/revenues for your hospital and/or health system and must be recognized as such. Yes, there are areas where there are no reimbursements, like the nursing floors, but cost increases equal better care and better outcomes. With better care and better outcomes, you work towards knocking down patient stays which will keep revenues rolling to turn your hospital’s beds.
In today’s world, I would track revenue increases as compared to cost increases. This will shape a whole new understanding of the power that VA handles each and every team meeting.
Value Analysis Has No Quality Attributes in the Process – “Quality” and even the term “value” are a bit subjective. My quality and/or value is going to be different than your quality or value and the same could be said about our customers, clinicians, and administrators. If you hang your hat on those terms, it becomes subjective and that is not what value analysis is about. That is why the core principle of value analysis is functional analysis which Larry Miles, the father of value analysis, instilled in the methodology at the start. What good does a lower price do when the functionality does not meet the customers’ unique requirements? We can meet functional requirements exactly with value analysis, but when you entertain subjective terms like “quality” or “value,” it becomes a slippery slope that you need to stay away from.
Value Analysis Begins and Ends with the Customer – Our end customers, stakeholders, and experts should be consulted before, during, and after a value analysis study/project is done. We start by studying their unique requirements and then functional alternatives which we test with their functional requirements. The end results must meet their requirements. It’s all about the customers with value analysis!
Healthcare Value Analysis is Not Only About Clinical Products – Value analysis can also be used on all products, services, and technologies, not just clinical devices. You can perform value analysis on hand soap, paper towels, air filters, cleaning products, etc. Value analysis is a universal methodology that can be used on any product, service, or technology using the functional approach. Plain and simple, VA works!
Value Analysis is a Problem-Solving Methodology – Have a problem with a product – what is functionally not happening? Have a problem with a process – what is functionally not happening in the process? Focus on functional attributes instead of the problem at hand. Look at what the product or process is and what it is not doing, then you can look for alternative solutions. Function first and foremost!
Keep these in mind and you will have value analysis success in more aspects than you ever imagined while doing less work with better outcomes and results.
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